The Tribune

More Bahamians have been urged to use trusts as a retirement and estate planning tool to avoid costly, bitter fights over succession and family assets.

Amanda Ferguson, Royal Fidelity's trust and estates manager, argued that trusts were "more beneficial" than Wills for avoiding family splits over how a deceased's wealth and estate are distributed.

"It's better to have a Will than nothing at all," she said. "Death can result in dissension, and even sometimes irreparable damage to a family structure. It's kinder, smarter and more beneficial to set up a trust."

She suggested that the best way for individuals to have their last wishes over the distribution of assets granted is to combine a trust with a Will. The latter will direct the distribution of assets that are outside the trust, and therefore form what is known as the individual's estate.

"Often a trust is established by the client (settlor) for estate planning and asset protection purposes, including confidentiality. The trust assets are distributed to specific people chosen by the settlor, called beneficiaries. The settlor can also be a beneficiary of the trust," Ms Ferguson added.

"That's the beauty of a trust. Once the client establishes a trust, their assets of choice, which can be made up of cash, stocks and bonds, real estate etc, are transferred into the trust and will only be distributed to the chosen beneficiaries of the trust.

"We service Bahamian clients and Bahamian residents. There are many benefits to having a trust, and I wish more people would ring me or come in to Royal Fidelity and get some information. Trusts are not difficult to set up and well worth the effort," she continued.

"Unlike a Will, trust assets can be distributed immediately upon the death of the settlor, as they are not subject to probate. The probate process can often take a year or longer, even if there is a will. The individual's loved ones must wait until probate is granted in order to begin receiving assets from the individual's estate.

"Probate documents are public records for all to see - who got what. Also, the Will requires an executor of the estate. Oftentimes individuals name a trusted friend or family member as their executor. However, the reality is that the named person may struggle with administering the estate due to grief, lack of knowledge of the probate process and time constraints (especially if the executor is employed)."